As you may remember from our July e-newsletter, Ohio recently created a new small business investment tax credit. New details of the program have now emerged and quick action may be required to take advantage of this tax credit which begins Monday, November 14th.
What is InvestOhio?
Through the program, individuals who invest up to $10 million in eligible small businesses
may receive a 10 percent income tax credit if the investment is held for two years.
The credit is a non-refundable personal income tax credit to investors that infuse new equity (cash) into Ohio small businesses to acquire an ownership interest in the company. The small business is required to reinvest that infusion of cash into one of five categories of allowable expenses within six months of its receipt. The investor must retain his or her ownership interest for a two year holding period before the tax credit may be claimed. The small business must similarly retain the property that it purchased from the cash infusion for the entire two year holding period.
The Director of Development is authorized to award up to $100 million in tax credits during the current State of Ohio fiscal biennium, which ends on June 30, 2013.
Who is eligible?
Eligible companies must have less than $50 million in assets or less than $10 million in annual sales. They must meet the requirements established by the Ohio Department of Development and the Department of Taxation to participate in the program. Eligible investors must apply and register investments with the Ohio Department of Development to be issued an InvestOhio certificate. The tax credits are not available to investors who invest in companies based outside of Ohio. To register for InvestOhio, you must be a member of the Ohio Business Gateway.
How does the InvestOhio process work?
InvestOhio has put together a very helpful video tutorial on the InvestOhio process. You can view the video here.
How can I register for InvestOhio?
InvestOhio has put together a very helpful video tutorial on InvestOhio registration. You can view the video here.
What is the deadline for InvestOhio?
The registration period will begin at 8 a.m. on November 14, 2011. The timing of when an eligible investor or small business applies is critical, as credits are awarded on a first come, first served basis. Once a party has completed an application, he or she will be given an InvestOhio Transaction ID number. This number will determine the priority for that transaction.
Note: Once the Director has accepted enough transactions to fulfill all of the available tax credits, the Director will inform applicants of where their transactions sit in the line of unfulfilled transactions so that they can estimate how close their transaction is to potentially being awarded a tax credit.
Where can I find more InvestOhio resources?
You can visit this link for more InvestOhio resources. Feel free to contact Keri Boergert or Amy Gibson at 440-449-6800 with any questions that you may have related to the program.